For decades, scientists have sought to elucidate self-organized patterning in development. One of the key questions in animal development is how a group of cells of one type keeps its identity and differentiates co-ordinately while surrounded by others. It has been shown that in certain cases, cells interact with their neighbours by diffusible factors in order to establish and maintain a common identity. This developmental process is called a community effect. In this work, we examine the dynamics of a community effect in space and investigate its roles in two other processes of self-organized patterning by diffusible factors: Turing's reaction-diffusion systems and embryonic induction by morphogens. Our major results are the following. First, we show that, starting from a one-dimensional model with the simplest feedback loop, a community effect spreads in an unlimited manner. Second, this unrestricted expansion of a community effect can be avoided by additional negative feedback. In Turing's reaction-diffusion system with a built-in community effect, if induction is localized, sustained activation also remains localized. Third, when a simple cross-repression gene circuitry is combined with a community effect loop, the system self-organizes. A gene expression pattern with a well-demarcated boundary appears in response to a transient morphogen gradient. Surprisingly, even when the morphogen distribution eventually becomes uniform, the system can maintain the pattern. The regulatory network thus confers memory of morphogen dynamics.